Bunnings is entering the housing market with flatpack homes from $26,000. – real estate.com.au

Australia’s most iconic home improvement store is making a monumental leap from hammers and nails to helping build entire homes, as it throws its weight behind a burgeoning solution to the country’s affordability crisis.

Bunnings Warehouse has teamed up with an innovative Australian start-up to offer compact, modular pod homes designed for backyards, many of which cleverly sidestep the need for traditional planning permission.

The retailer is now listing Elsewhere Pods flatpack homes online and through the Special Orders counter in store, with two models: a 2.7 x 2.4m pod priced at $26,100 and a larger 4 x 2.4m studio priced at $42,900.

Bunnings says the units can be assembled in just two days, positioning the products as DIY-friendly solutions that can serve as a crisis shelter, home office or teenage retreat.

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The pods can play a role as a crisis shelter, workspace or teenage retreat. Source: Bunnings

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Bunnings is also selling a larger 4 x 2.4 meter studio for $42,900. Source: Elsewhere Pods

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Elsewhere Pods, which announced its partnership with Bunnings in September and quietly launched with the retailer last month, is reporting sales of more than $9 million as demand for compact, modular homes rises.

Founder Matt Decarne calls the pods “the ultimate DIY” backyard project and says housing innovation must be part of the solution to Australia’s affordability crisis.

The company says some small and modular homes, including some of its designs, may not secure planning or building permission, which has become a key draw for buyers looking for speed and simplicity.

However, rules vary by municipality and state, with buyers urged to check local requirements before building.

Bunnings’ entry comes amid a wider turn towards prefabricated and kit homes. Major lenders such as the Commonwealth Bank are increasingly interested in prefabricated construction, while kit manufacturers have increased across the country.

Elsewhere, founder Matt Decarne dabbles in the larger granny flat product. (Source: supplied)

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Modular flatpack construction is expected to grow by approximately 7 percent per year to $18 billion by 2030. Source: Elsewhere Pods

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According to Yahoo fianceSydney couple Chris and Beau are building a three-bedroom kit house on Russell Island in Queensland, aiming to complete the entire build for around $150,000, having purchased the kit for just over $50,000.

Others, like Melbourne mother Maria Hatzi, opt for turnkey granny flats, with her two-bedroom building – complete with kitchen, living room, bathroom and laundry – costing around $250,000 to give her teenage son a stepping stone to a home of his own.

State governments have been cutting red tape for secondary housing, including Queensland and Victoria.

A recent survey by the Housing Industry Association found that builders expect to deliver about ten times more senior apartments this year than in 2022.

Market forecasters also see momentum building.

The pods are an affordable solution to enter the housing market on a limited budget. Source: Elsewhere Pods

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Small but mighty! Source: Elsewhere Pods

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Analysis from Mordor Intelligence shows that the Australian market for prefabricated buildings – which also includes modular flatpack construction – will grow at an annual rate of around 7 percent to $18 billion by 2030.

Elsewhere, Pods says almost a third of its revenue comes from off-grid ecotourism accommodation, underscoring the appeal of lightweight, quickly deployable structures for regional destinations.

“It is difficult for the industry to know exactly how many people live in small or modular homes because many small homes, including some of our designs, do not require planning or construction approval, which is a big draw,” he told Yahoo Finance.

“We built Elsewhere Pods to be more than just a home. It’s about safety, stability and choice, whether you’re recovering from a disaster, downsizing, investing in a rental property or just want a beautiful place to call home.”

With Bunnings now widely backing the concept, Australia’s best-known hardware brand has effectively entered the home building business, signaling the mainstreaming of small and modular living across the country.